UPDATE 2-U.S. sets antidumping duties on Argentine, Indonesian biodiesel

(Adds statement from Argentina foreign ministry)

WASHINGTON, Oct 23 (Reuters) - The U.S. Commerce Department on Monday set preliminary antidumping duties on imports of biodiesel from Argentina and Indonesia, after an initial finding that the products were being sold under market value in the United States.

The department set antidumping duties ranging from 54.36 percent to 70.05 percent on soy-based biodiesel from Argentina, and 50.71 percent on palm oil biodiesel from Indonesia, it said in a statement.

Commerce Secretary Wilbur Ross said in the statement that the government of Argentina has asked for negotiations, and that the department is working on possible suspension agreements.

Argentina's foreign ministry said the new duties would have little impact because preliminary countervailing duties of as much as 64.17 percent had already been applied in August, "making access to the U.S. market impossible."

"A possible application of additional duties has no practical effect in terms of real market access," the foreign ministry said in a statement to Reuters.

The statement said the government was working toward an agreement to suspend both the antidumping and the subsidies investigations.

U.S. producers of biodiesel petitioned their government earlier this year, saying foreign imports came into the country below market value, harming domestic makers.

Industry group the National Biodiesel Board praised the move, saying it had joined the petition to "address a flood of subsidized and dumped imports from Argentina and Indonesia that has resulted in market share losses and depressed prices for domestic producers."

Carbio, the Argentine biodiesel industry group, declined to comment.

Argentina's government is negotiating a minimum price for its biodiesel that it hopes could replace punitive tariffs, Horacio Reyser, secretary of international economic relations at the foreign ministry, told Reuters last month.

In 2016, imports of biodiesel from Argentina and Indonesia were valued at an estimated $1.2 billion and $268 million, respectively, according to the department.

Argentina in 2016 accounted for two-thirds of U.S. biodiesel imports, totaling 916 million gallons (3.5 billion liters), according to U.S. government data. (Reporting by Eric Walsh; Additional reporting by Michael Hirtzer in Chicago and Caroline Stauffer in Buenos Aires; Editing by Rosalba O'Brien and Lisa Shumaker)